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Tue, Aug 14, 07 at 17:26
| I hope I'm on the right forum here. I own a rental house that has an adjustable mortgage at prime. It's currently fully indexed and adjusting monthly.
I just received an offer for a HELOC on my primary residence at prime-1%. So I'm wondering about taking a HELOC and using it to pay off the mortgage on the rental. My concern is whether or not I can consider the HELOC on my primary residence as an expense for the rental, since obviously it wouldn't be secured by the rental. I know a HELOC is deductible as an itemized expense against my regular income, however I'm way over the AMT so it wouldn't help as much. I'm guessing this won't fly, but I welcome any comments or suggestions. |
Follow-Up Postings:
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| I agree it won't fly. It may be "cheaper" to refi your rental. I'd refi anything that adjusted monthly... unless it was about 4%. |
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| Thanks cmarlin. Refinancing is always an option, but I'd like to sell the property in the next year or two when the market stabilizes. I'm not sure I can get a rate much lower than the current 7.5% without paying points, and when you add in closing costs, it doesn't seem worthwhile until rates go lower. I'm not real conversant with the tax laws, I let my accountant sort it all out for me at tax time. I guess I should give him a call and see what he thinks. |
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| If you are now paying 7.5%, you probably can't do better. I'd let it sit and sell it. You'd pay more in loan costs than it is worth. Only thing I'd recommend is making sure you are getting top rent. If it will sell as a rental that will help your price and help your current cash flow. |
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